What Could be a Small Personal Loan Amount, and How to Avail it?

A small personal loan does not require collateral, meaning you do not have to commit assets to your lender. Small personal loans have a short turnaround time and are quick to process, as most approvals are received within 24 hours. These are perfect for situations when you do not need the money for long periods, as the loan can be taken for a term of only 10 days as well. Suppose you require quick cash for 20 days; you can apply for a small personal loan with any available lender. Stick to this blog to learn more about how you can apply for small personal loans.

Small personal loans can be availed solely online by going to the site of the lender you wish to take this loan from. The eligibility criteria can be ascertained by filling up a quick form. Once you are eligible, depending on the lender and approval process, you will receive a credit limit which can then be used to take the loan as per your needs.

Who can Avail of Small Personal Loans?

Salaried employees or self-employed individuals can avail of small amounts of personal loans. The amount can be taken to meet your personal and your professional financial requirements. Even businessmen and entrepreneurs can obtain a small number of personal loans to fulfil their working capital requirements. Usually, anybody with a steady income stream can get these loans. The lender will ask for bank statements and salary slips to ascertain whether the customer can pay this loan or not.

How to Check if You Are Eligible for a Small Personal Loan?

Below are the eligibility criteria you would have to meet to get a small personal loan.

• Salaried employee or self-employed person
• Must be over the age of 21
• Minimum earning criteria can vary from lender to lender, so you must go through the company policy.
• Should have Government IDs, i.e. Adhaar card and Pan Card

What Would be the Small Personal Loan Amount?

In most cases, the loan amount for every user is different due to various reasons like age, credit payment history, creditworthiness, income level, credit score, pending loans, etc. As per the eligibility criteria, every lender will decide a minimum and a maximum limit of loans that can be taken from the lender.

Before this, salaried individuals and small business owners who needed funds would have to get them from local lenders who generally charged despicable interest rates. But due to the boom in fintech companies such as Piramal Finance, this gap has been filled, allowing customers to secure loans quickly and, most importantly, hassle-free.

The minimum loan amount you can take changes from lender to lender, which is, on average, 10000 – but for a few lenders, loan amounts go as low as 5000. The maximum loan amount that you can get from a small personal loan is 2 lakhs. 

What is the Tenure of the Loan?

The tenure for repayment of the loan can easily be chosen by the applicant; most lenders give from 3 months to 2 years as tenure. However, few lenders offer small personal loans for as low as 15 days.

Documentation Required to Process a Small Personal Loan

Due to the nature of the loans and the small amount, financial institutions do not require a lot of documentation to process these loans. Such loans are marketed for people who need quick finance. You can complete the entire documentation process within 5—10 minutes before receiving the credit in your bank account. 

To avail of a small personal loan, the following documents are required:

• Income proof (ITR of the past year, income declaration statement, or salary slips for the past three months)
• ID proof (Aadhaar card, PAN card, passport, or voter ID)
• Age proof (Aadhaar card, Voter ID, passport, or driving licence)
• Bank statement for the last six months
• Passport-size photographs

Uses of Small Personal Loan

A Small Personal Loan can suddenly boost the applicant’s cash flow when he requires quick and easy access to finance. You can use these personal loans for any purpose. When a businessman is looking for cash to pay his credit, he can apply for a small personal Loan. A salaried person can avail of a small personal loan and use it to buy household needs or pay off credits during the month’s end. A student who is looking for funding for his assignments can easily avail of this loan because the payment tenure and the overall amount will suit his cash flow.

The uses of small personal loans are totally up to the applicant’s imagination, they can use the loan amount for anything they want to do. Due to this being a personal loan, there is no limit to the use of small personal loans. 

If a person doesn’t have a credit history, i.e. they have not taken any loans, then they will not be accepted for regular loans. However, small personal loans don’t require an applicant to have a credit history. People with no credit can apply for these loans too; of course, they will not be given a very high limit to exhaust, but they will be able to secure some loans.

Key Takeaways

• Anyone with a steady income can easily get a small personal loan.
• To be eligible to apply for a small personal loan, the person should be a minimum of 21 years of age and must have valid government ID proof. He/she should also match the lender’s earning criteria.
• Small personal amount ranges from 10,000 to 2 lakh but can be as low as 5000.
• The tenure for the payment is generally between 3 months and 2 years, but some lenders offer tenure as low as 10 days.
• Documents required to get the small personal loan are income proof, ID proof, age proof, and bank statements.

Hope this blog was informative for you. To apply for a personal loan, you can check out our website.